When companies pay dividends to Australian shareholders out of after-tax profit, shareholders receive franking credits, which they can claim as a tax deduction. If the shareholder does not pay any tax, they receive a cash refund from the tax office. This system is known as “dividend imputation” and these cash payments cost the Government about $6 billion per year. Do you personally receive a tax deduction or a cash payment for franking credits?
| Total | Men | Women | Aged 18-34 | Aged 35-54 | Aged 55+ | Less than $600
pw |
$600-1,000 pw | $1,000-1,500 pw | $1,500-2,000 pw | More than $2,000 pw | |||
| Yes, receive a tax deduction | 16% | 20% | 12% | 18% | 15% | 15% | 3% | 10% | 17% | 19% | 29% | ||
| Yes, receive a cash payment | 10% | 12% | 8% | 8% | 7% | 14% | 9% | 12% | 12% | 9% | 8% | ||
| No, don’t receive either. | 60% | 56% | 64% | 52% | 64% | 64% | 72% | 64% | 61% | 53% | 52% | ||
| Not sure | 14% | 12% | 16% | 22% | 14% | 7% | 15% | 15% | 10% | 19% | 10% | ||
26% said they either received a tax deduction or a cash refund for their franking credits.
Those most likely to receive a tax deduction were incomes over $2,000pw (29%), full-time workers (23%) and university educated (24%).
Those most likely to receive a cash payment were aged 65+ (22%).